Petrobras, Brazil's state-controlled oil producer, said the Franco pre-salt field, which the company purchased from Brazil's government last year, could be home to 4 billion barrels of recoverable reserves of oil and natural gas. That is above the last Franco estimate of 3.1 billion barrels, but still below the initial estimate of 4.5 billion barrels.
Petrobras (PBR) paid the government $42.5 billion for the rights to produce 5 billion barrels of oil from Franco and six other fields in the so-called pre-salt region of the Santos Basin, according to Bloomberg News. In 2010, the company sold $70 billion in shares in the biggest share offering ever to pay for the government's reserves.
As part of its plan to boost production to over 6 million barrels per day by 2020, Petrobras is targeting production at Franco and the other fields it purchased last year of 845,000 barrels per day by 2020. Last month, Petrobras unveiled a five-year spending plan of nearly $225 billion, by far the largest of any of the world's major oil companies.
Petrobras plans to invest $12.4 billion over the next five years to explore and develop the fields it purchased from the government last year, according to Bloomberg.